Prudential 2005 Annual Report Download - page 138

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PRUDENTIAL FINANCIAL, INC.
Notes to Consolidated Financial Statements
15. STOCK-BASED COMPENSATION (continued)
A summary of the Company’s employee restricted stock shares, restricted stock units and performance shares is as follows:
Restricted
Stock
Weighted-
Average
Grant Date
Price
Restricted
Units
Weighted-
Average
Grant Date
Price
Performance
Shares(1)
Weighted-
Average
Grant Date
Price
Outstanding at December 31, 2002 ..................... — — —
Granted .......................................... 1,917,152 $33.66 139,452 $33.61 236,933 $33.61
Forfeited ......................................... (175,283) — —
Released .......................................... (96,724) (606) —
Outstanding at December 31, 2003 ..................... 1,645,145 138,846 236,933
Granted .......................................... 1,376,892 $44.96 94,084 $45.00 502,545 $44.93
Forfeited ......................................... (208,078) (6,998) (12,065)
Released .......................................... (124,695) (3,981) (1,036)
Outstanding at December 31, 2004 ..................... 2,689,264 221,951 726,377
Granted .......................................... — $ — 1,059,183 $56.81 426,958 $55.77
Forfeited ......................................... (113,659) (58,006) (12,183)
Released .......................................... (183,848) (9,484) (1,456)
Outstanding at December 31, 2005 ..................... 2,391,757 1,213,644 1,139,696
(1) Performance shares reflect the target awarded, reduced for cancellations and releases to date. The actual number of shares to be awarded at the end of
each performance period will range between 50% and 150% of this target based upon a measure of the reported performance for the Company’s
Financial Services Businesses relative to stated goals.
A summary of the Company’s non-employee restricted stock shares, restricted stock units and performance shares is as
follows:
Restricted
Stock
Weighted-
Average
Balance
Sheet Date
Price Per
Unit
Restricted
Units
Weighted-
Average
Balance
Sheet Date
Price Per
Unit
Performance
Shares(a)
Weighted-
Average
Balance
Sheet Date
Price Per
Unit
Outstanding at December 31, 2002 ...................... — — —
Granted ............................................ 13,946 — —
Forfeited ........................................... — — —
Released ........................................... — — —
Outstanding at December 31, 2003 ...................... 13,946 $41.77 — $ — — $—
Granted ............................................ 10,629 844 —
Forfeited ........................................... (1,708) — —
Released ........................................... — — —
Outstanding at December 31, 2004 ...................... 22,867 $54.96 844 $54.96 — $—
Granted ............................................ — 12,466 —
Forfeited ........................................... (1,848) (806) —
Released ........................................... — — —
Outstanding at December 31, 2005 ...................... 21,019 $73.19 12,504 $73.19 — $—
The weighted average price of employee restricted stock shares, restricted stock units, and performance shares is based on the
quoted fair value of the Company’s Common Stock on the date of grant. The weighted average price of non-employee restricted
stock shares is based on the Company’s Common Stock price at the balance sheet date.
Compensation cost of awards is based on the price for each award and is recorded as expense over the vesting period which is
typically three years. The compensation expense recognized for employee and non-employee restricted stock shares was $33
million and $34 million for the years ended December 31, 2005 and 2004, respectively. The compensation expense recognized for
employee and non-employee restricted stock units and performance shares combined was $46 million and $18 million for the years
ended December 31, 2005 and 2004, respectively.
Prudential Financial 2005 Annual Report136